Flipkart, Amazon and Snapdeal grappling with shortage of delivery boys in festive season rush

The demand has accelerated to about 100,000 bikers, according to staffing firms which are facing a massive shortage of up to 70%.Prachi Verma | ET Bureau | Updated: October 17, 2015, 12:56 IST

The ecommerce logistics space raised over $300 million in the first six months of this year alone, as per data by VCCEdge.The mega sales push by leading e-tailers has propelled the demand for delivery boys or bikers to an all-time high. Salaries and incentives for high performers have already shot up more than 50% to about Rs 25,000 a month as staffing firms are grappling with a severe shortage of bikers. And this could be just for starters, for the busiest phase of the festive season for retailers has just set in.

The demand has accelerated to about 100,000 bikers, according to staffing firms which are facing a massive shortage of up to 70%. A year ago, online retailers in the country required just about 40,000 bikers to deliver the goods.

"This festive season, we estimate up to one lakh jobs will be created in mostly the delivery, logistics and customer care space. With the spike in the number of ecommerce companies, we are also witnessing a demand-supply gap where companies are finding it difficult to spot talent," said Kamal Karanth, managing director of Kelly Services & KellyOCG, India.

Rituparna Chakraborty, cofounder and senior vice-president of TeamLease said organised staffing firms such as hers are able to meet only 30% of the current requirement of delivery boys.

So when Sachin Bansal, co-founder of Flipkart, turned delivery boy in Bengaluru on Friday to gather insight into buyers' psyche, he may have also helped fill a position for which online shoppers are finding it tough to get suitable candidates. Bansal shared his experience in a series of tweets and also uploaded pictures of his delivery mates.

The festive season begins from mid-August and lasts till early next year but the critical phase for retailers is traditionally between Navratri and Diwali.

"We are struggling at the moment as we are short of bikers by over 60%. With many new ecommerce companies cropping up this year, the demand for them is only accentuating," said RP Yadav, chairman and managing director of Genius Consulting.

The shortage has forced the company to tap into the villages around metros, including Delhi, Mumbai and Chennai, to plug this shortage. "We are taking the help of local gram panchayats to get hold of this young talent pool," said Yadav.

Efficient delivery boys can easily earn more than Rs 50,000 in October-November, according to AG Rao, group managing director of ManpowerGroup Services India. "As more ecommerce players have come into play, this year the demand for bikers and warehouse resource is much higher than last year. Positive sentiment is also pushing the online demand for products," said Rao.

While some staffing firms are looking at hiring youth from villages adjoining the metros, others are resorting to poaching in earnest. "Our delivery team ensures that we are adequately staffed and trained to ensure we continue to delight our customers through the peak season," said Samuel Thomas, director transportation at Amazon India.

"We have significantly ramped up the number of delivery associates ahead of time keeping the festive season in mind," said Thomas.

The head of a leading staffing firm shared the modus operandi of poaching on condition of anonymity. "Many big staffing companies employ a couple of executives on contract to fill vacant positions. These executives go on field duty and start visiting malls and shopping outlets on the pretext of buying something," he said. "They befriend the potential hires, gather their contact details and later offer them 5-6% more than what they are getting in their current job."

The other techniques include pasting posters near malls, shopping complexes, traffic signals, hotels and petrol pumps.

"It is for certain that the ecommerce model will fail if the delivery element is not taken care of. Ecommerce thrives on a robust delivery mechanism," said Revant Bhate, co-founder of Faasos. Global InnovSource Solutions' Chief Operating Officer and Director Raja Sekhar Reddy said, "We send down our employees to look out for any person filling petrol in their bikes for Rs 100 or so. They are our targets and most of them convert to become bikers for ecommerce companies."

Ecommerce logistics company Delhivery too is finding difficult to access this talent. "Ecommerce is a new industry, there are no trends to co-relate to. Every quarter, new customers are being added. Unlike last year, we are getting a lot of demand for bikers from second tier cities like Jaipur and Pune. We had not foreseen this," said Surbhi Dewan, vice-president-HR and co-founder at Delhivery. Adamas HR Services, a small staffing firm has on its part dispatched about 50 people to the hinterlands to catch raw talent.